Nordea Bank (NRBAY) and Its Peers Critical Comparison

Nordea Bank (OTCMKTS: NRBAY) is one of 63 publicly-traded companies in the “Commercial banks, not elsewhere classified” industry, but how does it compare to its competitors? We will compare Nordea Bank to similar companies based on the strength of its institutional ownership, earnings, valuation, analyst recommendations, risk, dividends and profitability.

Valuation & Earnings

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This table compares Nordea Bank and its competitors revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Nordea Bank $13.96 billion $3.43 billion 12.18
Nordea Bank Competitors $14.29 billion $2.16 billion 10.81

Nordea Bank’s competitors have higher revenue, but lower earnings than Nordea Bank. Nordea Bank is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Dividends

Nordea Bank pays an annual dividend of $0.69 per share and has a dividend yield of 6.7%. Nordea Bank pays out 81.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Commercial banks, not elsewhere classified” companies pay a dividend yield of 2.5% and pay out 34.8% of their earnings in the form of a dividend.

Volatility & Risk

Nordea Bank has a beta of 0.75, indicating that its share price is 25% less volatile than the S&P 500. Comparatively, Nordea Bank’s competitors have a beta of 0.93, indicating that their average share price is 7% less volatile than the S&P 500.

Profitability

This table compares Nordea Bank and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nordea Bank 26.09% 9.54% 0.49%
Nordea Bank Competitors 18.68% 12.06% 1.04%

Insider & Institutional Ownership

0.1% of Nordea Bank shares are held by institutional investors. Comparatively, 23.3% of shares of all “Commercial banks, not elsewhere classified” companies are held by institutional investors. 12.8% of shares of all “Commercial banks, not elsewhere classified” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Nordea Bank and its competitors, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nordea Bank 0 6 0 0 2.00
Nordea Bank Competitors 465 1477 1452 68 2.32

As a group, “Commercial banks, not elsewhere classified” companies have a potential upside of 11.50%. Given Nordea Bank’s competitors stronger consensus rating and higher possible upside, analysts plainly believe Nordea Bank has less favorable growth aspects than its competitors.

Summary

Nordea Bank competitors beat Nordea Bank on 11 of the 15 factors compared.

Nordea Bank Company Profile

Nordea Bank AB (publ) provides various banking products and services for personal customers, small and medium business, and corporates and financial institutions in the Nordic and Baltic Sea region. It operates through Personal Banking, Commercial & Business Banking, Wholesale Banking, and Wealth Management segments. It offers investment solutions, including fixed income, equity, and multi asset; cash management solutions; a range of asset finance, sales finance, and receivable finance solutions, as well as wholesale financing and management, and fleet management services. The company also provides securities services, such as custody services, including clearing, settlement, and safekeeping of domestic and foreign securities; administrates and processes corporate action events, paying agent, registrar services, equity incentive plans, and others; and sub-custody services, including account opening, settlements, income collection, taxation, corporate actions, proxy voting, reporting, and market advocacy. In addition, it offers life and pensions products; trade finance services; leasing and hire purchase products; and online and mobile services. It has approximately 650 branches. The company was founded in 1820 and is headquartered in Stockholm, Sweden.

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